Oregon Progressive Party candidate, Chris Henry, discusses the need and benefits from the creation of a state public bank. He also discusses the projected shortfall in the PERS system and says that the shortfall can be taken care of from the General Fund over a period of time, largely by cutting out the Wall Street middle men from Oregon's financial operations. Much more at Chris Henry for Treasurer.

One of the quieter races this electoral season has been that of Oregon treasurer. Former Multnomah County Chair Ted Wheeler seems to be in a good place to keep the position, which he was appointed to last spring when Ben Westlund passed away.

However, one man continues a long crusade to bring attention to some issues and solutions that are commonly-overlooked.

Walt Brown – a retired Lake Oswego attorney, who represented the area in the state Senate from 1975 to 1987 and has made third party bids for attorney general, Congress and president- is making a go at the office that oversees the state’s finances, and is hoping to bring up several ideas (some of which he admits are outside the purview of the office he’s pursuing) that he says will improve Oregon’s economy.

State bank

Brown wants the creation of a state bank to get capital and lending flowing in the state, which will help combat Oregon’s chronically high unemployment rate. He said that a state bank would work with private banks to help co-invest and keep interest rates low.

He points to North Dakota, which has a state bank and a relatively healthy economy, as an example of how such an entity can be a stabilizing influence.

However, the idea faces one big hurdle: Oregon’s constitution prohibits the creation of a state bank.

“That would be a problem,” admits Brown. “But all problems that are legal can be solved simply by amending the constitution. Of course, you don’t want to amend the constitution in a stupid way, which we’ve done from time to time.”

Health care reform

Brown said that the cost of providing health insurance to employees is hurting businesses, and the health care cost to state workers is also hurting Oregon’s finances.

He has been a longtime advocate for single-payer health insurance, which he said will be good for the state and good for business by shifting the cost of increasingly expensive health insurance premiums.

“The state could really save money if they set up their own health insurance,” he said.

Public power

Brown argues that Washington state is faring better economically because businesses have fewer costs under publicly-owned utilities, unlike much of Oregon, which he hopes to change.

Invest in Oregon

Brown said that if elected treasurer he would stop directing the state’s investments outside of Oregon, even if they bring in a lower return, a stance that he said distinguishes him from Wheeler. He would also push to have every layer of state and local government buy locally.

“There’s a multiplier effect of increasing jobs,” said Brown of his approach.

Investing money back into the state’s economy will pay off in the long run, he said.

Walt Brown was a Democratic state senator from Lake Oswego from 1975 to 1987, but he's running as the Progressive Party nominee for state treasurer.

Since he left the Senate, Brown has been the Socialist Party nominee for Congress in four elections, the Socialist Party USA candidate for president in 2004, and the Pacific Green Party nominee for attorney general in 2008. He said the treasurer is an independent official who should not be the financial adviser to governors and legislators. But he also said the treasurer has a role to play in Oregon's economy, particularly in trying to reduce the current unemployment rate. "We've got to turn that around," he said. He is an advocate of a state-owned bank, based on the only other such bank in North Dakota. Voters would have to remove a constitutional ban on a state bank that dates to statehood 151 years ago.

Michael Marsh of Salem, a maintenance worker at McDonald's, was the Constitution Party nominee for state treasurer in 2008. (There is another Mike Marsh in Salem, who is unrelated, a former state official who is a contributing assistant professor at the Atkinson Graduate School of Management at Willamette University.) He said he would block issuance of any new state debt, and that he is running to make a point not only about Oregon's finances but also the nation's. "The United States government is self-destructive, and I'd like the chance to turn things around," he said.

More than 125 people packed into the ballroom at Chinook Winds Casino Resort on Sunday, Oct. 10, to grill candidates seeking office in the Nov. 2 elections. The News Guard reporter Patrick Alexander was there.

Posted: Tuesday, October 12, 2010 2:28 pm

PATRICK ALEXANDER The News Guard

Of the four candidates seeking the job of looking after the state's $68 billion investment portfolio, only two attended the forum - incumbent Democrat Ted Wheeler and challenger Walt Brown from the Progressive Party.

Wheeler was appointed to the post six months ago following the death of fellow Democrat Ben Westlund.

He said the treasurer must provide financial leadership for the state, laying the foundation for economic growth and helping the state "get its financial house in order" as legislators brace for another round of budget cuts.

Wheeler, who came to office amid a scandal about the luxurious travel habits of state investment officers under previous treasurers, said he took swift action to tackle the problem - reforming controls and requesting an outside audit of the agency.

"I ended first-class travel," he said. "I ended golf."

Wheeler said treasurers' offices across the country have asked for the results of the reforms implemented in Oregon.

Brown said Oregon has a long history of economic woes that predates any of the state's incumbent officeholders.

"In the last 30 years," he said, "we have had above-average unemployment for 25 of them."

Brown said Oregon could learn from other states, such as North Dakota, which has the only state-run bank in the U.S.

Brown noted North Dakota has the lowest unemployment rate in the nation - just 4 percent in March 2010 compared to the average 9.1 percent.

He said the treasurer's office should put more of the state's $68 billion investments to work in Oregon rather than further afield.

"I don't want to sound like a raging nationalist," he said, "but we can't build Oregon by investing in New Jersey and China."

Republican candidate Chris Telfer and Constitution Party candidate Michael Marsh are also on the ballot for the position.

Eleven employees in the Oregon treasurer's office received bonuses in February ranging from $9,860 to $57,006.

The money was paid as a performance reward to investment managers who oversee the Oregon Public Employees Retirement Fund, the Common Schools Fund and other portfolios totaling about $60 billion.

. . . Last year, with the nation mired in recession, the Public Employees Retirement Fund was down 27 percent, which was not comforting to thousands of retirees but in line with other public pension systems. Based on the performance of the fund and other state funds, 11 of the 14 investment managers in the treasurer's office were paid a total of $475,000 in bonuses and related costs.

State Treasurer Ted Wheeler stepped up his efforts Wednesday to reform his agency in the wake of disclosures that employees have been traveling in luxury at the expense of the investment firms they oversee.

Wheeler has asked Secretary of State Kate Brown to evaluate travel undertaken last year by state investment officers.

He also said he will appoint a citizens panel to review the agency's travel policies and recommend changes. He said he would then ask the Oregon Government Ethics Commission to endorse a new travel policy.

For years, the Oregon State Treasurer's office has had a laissez faire policy on staff participation in golf outings while on duty and traveling on state business.

Ron Schmitz, Treasury's chief investment officer, said such outings had been approved by the agency's senior executives and vetted by agency attorneys, despite state law that in some circumstances prohibits taking free outings.

The Progressive Party Oregon, the state's newest political party, has endorsed State Senator Rick Metsger for the office of State Treasurer.

The endorsement was based on Senator Metsger's long history of standing up to powerful interests and looking out for the average person.

Rick Metsger was the chief co-sponsor (along with Senator Vicki Walker) of SB 408 (2005), which stopped the private utilities from charging Oregon ratepayers for "income taxes" that the utilities actually never paid. These charges had amounted to over $1 billion since 1997. "The result was a rate reduction of $37 million for PGE customers due to their tax overpayments to PGE in 2006 and additional reductions since then," said Dan Meek, press secretary for the Progressive Party.

Oregon Treasury employees wined and dined by investment firms they oversee
The Oregonian
April 11, 2010
by Les Zaitz and Ted Sickinger

The Pebble Beach Golf Links, with Carmel beach in the background, is one of many luxury locations private investment companies use when they host investment officers from the Oregon Treasury.A limousine was waiting for John Hershey, an Oregon state investment officer, when he flew into New York for a meeting just before Thanksgiving.

So was a $495-a-night room at The Pierre Hotel, which purrs online that "even in a city where exclusive luxuries are the norm, there is one hotel that is far more rare and special."

Following an afternoon meeting, Hershey was offered cocktails and dinner at Guastavino's, which boasts "the highest staff-to-guest ratio in the city."

In response to an ongoing investigation by The Oregonian, Oregon Treasurer Ted Wheeler on Wednesday announced measures to clamp down on travel by the agency's investment officers, ending free golf and first-class airfare they enjoyed while monitoring $67 billion in state money.